Indians fans collectively blew a gasket last night when news broke that the team had turned down an offer from Masterson and that negotiations are now (supposedly) put on hold.

We’re all sick of seeing our favorite players leave and all signs point to Masterson being the latest fan favorite to depart Cleveland. Most fans jumped to the conclusion that the Dolans were being cheap and turning town a reasonable offer from a fan favorite.

But if you can keep a cool head for a few minutes, I’ll explain why this is absolutely the right decision.

$17M is a lot of money.
Pitchers are expensive, but Masterson’s asking price is getting into an elite range. According to Ken Rosenthenal on Twitter, Masterson’s agent offered a deal of three years and less than $17.5M per year.

In 2014, only 10 pitchers will earn more than $17M.

Some fans have pointed to Ervin Santana’s recent $14M deal as proof that Masterson is worth $17M. But that’s looking at things a little too simplistically.

For starters, the Braves ponied up $14M out of desperation when Kris Medlen suffered a season-ending injury. Just because someone overpaid for Santana doesn’t mean the Tribe should do the same for Masterson. Secondly, it was a one-year deal. It’s a lot easier to knowingly overpay for someone when the contract comes off the books in six months.

In order to pay Masterson $17M, the Indians would have to feel as though he was a top-10 pitcher, or at least close to it… which leads me to my next point.

Masterson is a model of inconsistency.Fans love Masterson because he turns in a few gems every year. These are the games fans remember, but they’re quick to forget the painful 100-pitch, five walk, five inning outings which are just as plentiful.

Let’s take a look at a visual display of just how unpredictable Masterson can be, by using his 2013 game scores (click on the image for a larger view).

Not only is Masterson no where close to a top-10 pitcher – which is the range he would enter with a $17M contract – but he’s barely above average.

ERA+ is a statistic which normalizes ERA based on the league average. An ERA+ of 100 is equal to the league average, and it allows us to compare players across eras. Over the past three seasons, Masterson’s ERA+ is an even 100, which perfectly sums up his roller coaster performance.

To put that 100+ ERA into context, consider some other Tribe pitchers who have posted similar numbers over the same time frame:

Mark Clark – In his three years with the Tribe, Clark posted an ERA+ of 103. Like Masterson, he had his moments, highlighted by seven complete games in that span, but he also struggled with control and was bounced early just as often.

Chuck Finley – Ironically one of the most hated underachievers in recent Tribe history compares favorable to Masterson, with a 102 ERA+ in just over two years in Cleveland. Finley was earning roughly $8M per year, which likely put him among the top 10-15 pitchers of that era and significantly contributed to the fans distaste for his performance.

Obviously we weren’t happy paying Finley like a top-10 pitcher. And we certainly wouldn’t have felt good about giving Clark that type of contract. So why should we treat Masterson any differently?

The Indians don’t have money to waste.It would be great if the Indians had $125M to spend however they like, but they don’t and they never will.

During the late 1990s the Indians payroll ranked among the highest in the league, but only because Dick Jacobs was willing to spend his own money. I won’t get into the details, but if you’re interested I highly recommend reading Terry Pluto’s book Dealing which offers some insight into the Indians financial situation in that era.

But to summarize the situation, they were losing money. Jacobs wanted a winner and he was willing to spend money to make it happen. It was great for the fans, but it wasn’t a sustainable model. Ultimately, baseball franchises are businesses and they need to turn a profit in the long run.

In this era, money in sports is tied almost exclusively to television. And television money is limited by viewers. Among the 30 baseball teams, Cleveland ranks 21st in terms of television market size.

Think that stat doesn’t matter? Well, take a look at the list of the highest payrolls for 2014 and their TV market rank:

Los Angeles Dodgers – No. 2 TV market

New York Yankees – No. 1

Philadelphia Phillies – No. 4

Detroit Tigers – No. 11

Boston Red Sox – No. 7

Los Angeles Angels – No. 2

San Francisco Giants – No. 6

Texas Rangers – No. 5

Washington Nationals – No. 9

Toronto Blue Jays – No. 1 in Canada

20 baseball teams play in a TV market larger than Cleveland, which almost perfectly corresponds to the Indians 23rd rank in payroll for 2013.

The Indians have a budget, and it’s already been spent.
The fact that the Indians are even willing to negotiate with Masterson shows that the Dolans are willing to spend at least a little extra money to keep their own guys.

The Indians have been trying to operate around $70-$80M. The Masterson deal would likely force them to push closer to $85 or even $90M. Percentage-wise, that’s a pretty significant jump. They’re at $77M right now, boosting it to $90M would be a 17 percent increase – now imagine adjusting your spending by 17 percent. It’s easier said than done.

The reason adding Masterson would be so difficult is due to the fact that Nick Swisher and Michael Bourn are already earning roughly $15M per year. If the Indians signed Masterson for $17M, they would have $43.5M wrapped up in those three players in 2015, and the number would rise in the following years.

That would be roughly 50 percent of their payroll tied up in three players and that’s not a model that works. It would shoot down any possibility of bringing in other free agents or re-signing others.

Cabrera would be gone for sure (he probably already is). Kipnis wouldn’t be able to get his new deal. As well as anyone else who may emerge (Kluber? McAllister? Chisenhall?).

The Tribe would be tied to Bourn, Swisher and Masterson for the next three years, and if any of them didn’t produce there would be no wiggle room in the payroll to make adjustments.

So we’re just supposed to let our players leave?
Well, yeah.

It sucks. But there’s nothing we can do about it. Baseball doesn’t have a level playing field.

Teams like the Indians have to operate in a constant state of rebuilding, while hoping to catch lightning in a bottle three or four rookie contract players hitting their stride at the same time.

It’s not productive for us fans to complain about the front office and ownership. Our ire should be directed at Bud Selig and the other 29 owners (or, more realistically, a small powerful group of them) who allow this unbalanced model to exist.

The Doctor

masterson (and/or his agents) suggesting that 17.5mil/year is some sort of hometown discount is either an extremely poor joke or a giant “F you” to cleveland’s front office. just because cincy and atlanta wildly overpaid for bailey and santana doesn’t mean it makes sense for us to do the same with masterson.

cue the ranting from fans who consistently choose to ignore the reality of cleveland’s market and payroll flexibility and can’t think beyond “we’re letting one of our guys get away again”.

Ghost of Joel Skinner

A discount would be $10-12M a year, $13-14M would be “fair”. He’s not a $17M a year pitcher – his offer was ludicrous. And…oh look, Scherzer turned down an offer from Detroit in the neighborhood of $24M a year. Scherzer, Lester on the market next year. Masterson will be begging for a contract in March.

joe gaynes

This ^^^^^^^^

Masterson is at best (according to his stats) on the low end of a SP2. 17.5M worth, he is not.

Seth

I can’t argue with the logic or the statistics but I also can’t shake the feeling that this is going to kill the season just like CC’s situation killed the team in 2008. If this team gets off to a bad start everyone knows that Masterson and Cabrera are gone and so is the season. Not to mention that the team will be well aware of this heading into the season, increasing the pressure that everyone will feel from game 1.

I am optimistic that Francona can manage some of that tension but at the same time, I would guess that he is just as upset as everyone else about the impending departure of his favorite player. Well, I guess this year Terry gets to find out what it is really like to coach here.

Lou Torti

Well , I still think Tito can get the most of what he has.He’ll use a lot more bubble gum this year without Kazmir and Ubaldo.

medfest

I asked people to look up the numbers and then Ryan McC thoughtfully provides them.

Here are the FACTS ,not half assed opinions,that show Masterson is a slightly above average starting pitcher who is 29 years old,in the middle of his “prime” and unlikely to get much better.

Masterson won’t be traded, unless the season really goes into the toilet early,because the new CBA makes keeping him and getting an extra draft pick valuable.

Giving guys like Masterson big money(for Cleveland)even on short term deals does not make economic or baseball sense.

But hey don’t let facts get in the way of bashing the Dolans or coming up with any other lame excuse for not attending Tribe games.

Adam Hintz

I have to say that Ryan NAILED this argument. Pack it up, folks, we can go home.

Also, I love that the comments are mostly on his side; we have a smart bunch of readers here at IPL, and I love that.

I would ABSOLUTELY pay an ace all the money I could pay them, but Masterson is not an ace. If I could sign Masterson to the same deal Ubaldo got (4 years, $12 million), I’d do it in an instant –and I think the Indians would, too. $17.5 million is ridiculous, though.

Where did this talk of a hometown discount come from, anyway? This is the same pitcher who just lost an arbitration hearing because he overvalued himself. Let’s just be real here… the talk of a “discount” was in years, not dollars. And $17 million is just too much — for 1 year, 3 years, of 7 years.

Sean Porter

Actually this is the same pitcher who avoided arbitration with the Indians.

Is the system messed up – of course. Here’s a question then: Why did the Indians bother to sign Swisher and Bourn last year? To secure mediocrity for the next few years and hope that Salazar’s arm doesn’t fall off or Trevor Bauer actually gets some clue on how to get that white sphere somewhere near that 17″ white plate 60 feet, 6 inches away?

medfest

They signed Swisher and Bourn,at below market prices,last year because they didn’t have anyone to play the outfield or fist base.Another year of Shelley Duncan and Casey Kotchmann is something you wanted to see?

I would hardly call winning 92 games the first season they were here mediocrity and like it or not Masterson is eminently replaceable.In his 4 full seasons as a starter he’s averaged just less than 2 WAR per season.

Giving slightly above average pitchers contracts for one third more they they are worth is the fastest way to get on the mediocrity treadmill.

Sean Porter

We’ll see how “eminently replaceable” Masterson is after this season, I suppose. Pitchers who routinely get deep into games, and do it well, grow on trees nowadays.

But Masterson isn’t worth a few million dollars a year more than Swisher, who received a “below market contract” and may or may not ever have a season again with a .800 OPS, or a few more million dollars a year more than Bourn, who makes his living on his legs, which coincidentally enough, are starting to break down, again, on a “below market contract”?

And in case you haven’t noticed medfest – the Indians have been on the mediocrity treadmill for over a decade now. Obviously how they’ve done things, how they continue to do things, isn’t working.

medfest

They’re on that treadmill because of their farm systems lack of productivity and we all know it.

Swisher and Bourn may or may not play to their contracts, but they at least have a chance to since they’ve done it before.Masterson won’t pitch to 17.5 million a year based on his performance up until now and at 29 he doesn’t to figure to get much better or more consistent.

You are making Masterson out to be an all star type of pitcher,when he’s not even as good as Jake Westbrook was before the Indians signed him long term.

Bob

What can you buy with $17 million that you can’t buy with $12 million or for that matter $5 million. To the masses of the world $1 million is a lot of money. There is no love of the game, no loyalty; it’s all about ego, perceived value, entitlement, letting your agent egg you on. Earth to player?

trevor p.

at this point in his career Masterson wants a long contract of 5 years or longer. mlb players of Masterson’s age and experience want long contacts so i doubt Masterson is different and the recent contract talks,from both sides, was just dancing around the real situation imo.

Steve T.

I would support signing him to a contract with the terms we have seen.

Having said that, I do my coaching from the stands and don’t have any particular inside knowledge, just a fans “wants”. Given the success our new pitching coach group has had, is it possible they are privately telling management that he may not be worth that much? They seem to have a knack for getting the most out of the pitching staff (see Jimenez, Ubaldo and his turnaround). Maybe they privately feel Masterson’s as good as he’s ever going to be and will likely only depreciate in value over time.

Geez, I want to believe in something good here…

D.P. Roberts

Masterson is going to make $9.76 million this year.

Fun Fact #1: Several people have wondered what the difference is between paying Masterson a reasonable $14 million a year and his asking price of $17 million. After all, what does $3 million a year get you? Well, since McAllister, Kluber, Salazar, Carrasco, and Tomlin all make league minimum, you can pick any 4 of them for $2 million per year. Bauer earns $1.5 million, so if he makes the roster at some point this year, the difference between “reasonable” and “excessive” in the Masterson deal is still our entire starting staff.

Fun Fact #2: Regardless of who gets that 5th starting spot, or whether the Indians will have 7 or 8 guys in the bullpen, or who those players end up being, Masterson will still make almost as much this year than everyone else on the entire pitching staff COMBINED.

Here’s how it breaks out:
4 starters @ league minimum: $2 million
Axford: $4.5 million
Scrabble: $1.37 million
Outman: $1.25
Pestano: $975K
3 other bullpen guys at minimum: $1.5 million
Total: $11.5 million

And he’d like to almost double that next year!

Drew

Thank you for changing my view on this. Masterson is a better pitcher than Ubaldo Jimenez or Ervin Santana but if those guys make $12M a year on long term deals, then it is now clear to me that Justin Masterson is not gonna get a contract for much more than that either. This will really go in one of 2 directions. Either he is lights out this season and he will pitch himself out of the Indians price range or he will perform like he does on even years and lower his value. I am starting to like what the front office is doing here.

But we also must temper our expectations for 2014. Best case scenario, Masterson, Salazar, Kluber perform as they did in 2013. Maybe McAllister has a decent year too. The rotation is not as strong as it was in 2H 2013. The central division will also be better in 2014.

A 3 year deal also really helps minimize the risk involved. Masterson is a large, workhorse pitcher who logs a lot of innings. Those guys make a lot of money! And let’s face it, Masterson was probably our best player last year prior to his injury. Signing Bourn and Swisher last year really sent a morale jolt through the organization, just imagine what resigning our ace would do.

If Masterson leaves, could you justify having Bourn for $12 million/year on the roster? Masterson had a bad year in 2012, but he looks like a pretty sure thing going forward. Something you can’t say about Jimenez, Kazmir, Lincecum, Jackson and Nolasco.

ThatOneGuy

People should relax about the $17 mil figure. I’ve only seen reporters say they THINK that was the value.